The companies expect to begin mass production in 2020, despite an increasing competitive threat from battery-powered EVs.

Honda and General Motors have announced a manufacturing joint venture for a hydrogen fuel-cell system.

Fuel Cell System Manufacturing, LLC, will be housed in GM's existing battery pack manufacturing facility in Brownstown, Michigan, south of Detroit. The venture will require a combined investment worth around $85 million and create nearly 100 new jobs.

"Over the past three years, engineers from Honda and GM have been working as one team with each company providing know-how from its unique expertise to create a compact and low-cost next-generation fuel cell system," said Honda's North American COO, Toshiaki Mikoshiba.

GM and Honda claim to be leaders in fuel-cell technology, with a combined 2,220 related patents held between the automakers.

Hydrogen powertrain technology is facing tough competition from battery-powered EVs. A few years ago both batteries and fuel cells prohibitively expensive for mainstream vehicles, with sparse refueling and recharging infrastructure. In more recent years, however, batteries have benefited from a significant cost reduction and infrastructure explosion that have not been matched in the hydrogen segment.

"With the next-generation fuel cell system, GM and Honda are making a dramatic step toward lower cost, higher-volume fuel cell systems," promises Charlie Freese, GM's global fuel cell executive director. "Precious metals have been reduced dramatically and a fully cross-functional team is developing advanced manufacturing processes simultaneously with advances in the design."